Nashville Utilities and Brown County Water Utility are in the process of working out agreements that could settle one or both cases they’ve been working through on the state and federal levels.
It’s still unclear, though, what those agreements include, and whether or not they will result in changes to water bills for either company’s customers. Any agreements are “in principle” and not final, according to case documents.
The town-owned Nashville Utilities and the member-owned Brown County Water Utility are on opposing sides in two cases: one in federal court about water service territory, and another before the Indiana Utility Regulatory Commission about changing water rates and charges.
The state case
In March, BCWU petitioned the state for permission to raise the wholesale water rate it charges to Nashville Utilities by 154 percent. Nashville Utilities customers would feel that increase if the IURC approves it.
In that same request, BCWU outlined a plan to lower water rates by 14 percent for its 5,293 residential customers out in the county who are served by BCWU directly. Rates for BCWU’s small commercial and industrial customers would go up by 35 percent under that proposal.
BCWU provides the vast majority of the water that the town resells to Nashville Utilities customers, and Nashville Utilities is BCWU’s only wholesale water customer.
According to a document filed with the IURC on Aug. 23, the town, BCWU and the Office of Utility Consumer Counselor have agreed, in principle, to allow BCWU “to increase its revenue requirement by an amount that the parties agree is in the range of 3%-4% as an across-the-board Phase 1 increase.
“The parties are currently obtaining and reviewing expense data from BCW(U) that will confirm the final agreed increase amount,” the document says.
Town Attorney James T. Roberts — who is not the “attorney of record” in this matter — said his understanding is that the 3- to 4-percent increase would be applied to all BCWU customers equally, including the town as a single wholesale customer.
“Whether or not that would be passed on (to town water customers) I rather doubt,” he said. “Compared to 154 percent, it’s a very minuscule increase. … Nashville already pays Brown County Water a great deal and this will only make about a $6,000 to $7,000 difference in what we pay for wholesale water for a year.”
Any agreement would have to be approved by the IURC, said Anthony Swinger, media relations for the Office of Utility Consumer Counselor. The IURC also could choose deny or modify it. “The settling parties would file testimony in support of an agreement — if reached — and would have the burden of proof to show that the agreement is in the public interest,” Swinger said.
The Aug. 23 motion filed with the IURC also mentions the phrase “pending completion of the the sale of the utility.”
Roberts said he couldn’t comment on that topic.
BCWU and the town council have discussed selling Nashville’s water utility to BCWU before, but discussions broke down last year. One of the hangups, in addition to the terms and the price, was the town’s aging water infrastructure and the financial liability that would bring BCWU, said BCWU board President Ben Phillips in April.
Phillips did not respond to a request for comment on the developments in the state and federal cases before deadline last week.
The federal case
The Nashville Town Council has met in closed executive session six times since July 25 to discuss pending litigation. All council members are named in the federal lawsuit that BCWU filed against the town in the summer of 2017 over the rights to serve Hard Truth Hills with water two years ago.
The town is providing the restaurant and distillery development on Old State Road 46 with water now, but BCWU believes the land is in its exclusive water service territory.
On Aug. 27, the town council traveled to the United States Southern District Court courthouse in Indianapolis for a “settlement conference,” according to court documents. That’s the court in which BCWU had filed its lawsuit about territory.
Roberts said last week that he couldn’t comment on the status of that case.
In April, Phillips said that the water rate increase pending before the state did not have anything to do with the water territory case in federal court. He said that the amount of water that Nashville Utilities was using and the amount it was paying for it wasn’t fair to the other customers that BCWU serves, and that’s why the request for rate changes was filed with the IURC.
“BCW(U) and Nashville are still attempting to negotiate a comprehensive settlement of their issues in this case and a related federal court case,” says the Aug. 23 document written by attorney J. Christopher Janak in the state case. He is working for the town.
“If a comprehensive settlement is reached, it will likely resolve the rate design issue. Even if a comprehensive settlement cannot be reached, the parties may be able to reach an agreement on the rate design issue with additional time,” Janak wrote.
If the parties can’t come to a settlement, the federal case about water territory is set to go before a jury on Oct. 28.
Consumers said
The Office of Utility Consumer Counselor, which represents consumers’ interests in cases before the IURC, received 22 written comments in the BCWU vs. Nashville Utilities rate case. Most were customers of Nashville Utilities, and most were town residents. Commenters also included some Nashville business owners and a spokesman for RealAmerica, the company that operates low-income apartments in the Nashville area.
All commenters but one were strongly against the idea of Nashville Utilities’ water rates being allowed to go up by 154 percent.
The spokesman for RealAmerica, which houses 194 families in the Nashville area, warned that a water rate increase of that magnitude could cause rents to increase, which could prevent RealAmerica apartments from being used as Section 8 housing.
The one commenter who was in favor of the rate change was a longtime customer of Brown County Water Utility who liked the idea of her water bill possibly decreasing.
